The Lifestyle Updates Business Division has been working on offering products and services for various living environments, ranging from homes to stores, offices and cities, since its launch in October 2021. It includes five spin-offs that serve as the core of the Division: Living Appliances and Solutions Company, Heating & Ventilation A/C Company, Cold Chain Solutions Company, Electric Works Company and China and Northeast Asia Company. These lifestyle companies have been brought together as we conduct businesses in Panasonic’s original industry.
From April 2022, we will work together as the new Panasonic Corporation to improve quality of life from a customer perspective to contribute to enhancing the wellbeing of people, society and the Earth.
Future-Oriented and People-Based Corporate Value Management
We will promote corporate value management based on the concept of “future-oriented + people-based” to become a company that is indispensable to our customers and various stakeholders.
Future-oriented management involves managing our businesses based on our mission and vision, from a medium- and long-term perspective. We are committed to fulfilling our mission of “Life tech & ideas, For the wellbeing of people, society and the planet,” and the vision of becoming “We are the best partner of your life with human centric technology and innovation.”
In achieving people-based management, it is essential to become a company that serves customers cordially. We are also promoting a management structure that allows all 88,000 of our employees to face customers while at the same time conducting their work with satisfaction and pride. We envision that future-oriented management will attract engaging people, and these irreplaceable personnel will create a future through working together.
Consistently Promoting the Three Transformational Axes over the Long-Term
In order to enhance our corporate value in the lifestyle domain as the new Panasonic Corporation, we will focus on the three transformational axes: creating customer value, pursuing operational excellence and focusing management resources on growth businesses. At the same time, we will work on reforming our management system and human resources that serve as the foundation for achieving this transformation.
As a lifestyle business, creating customer value is our highest priority. To this end, we must incorporate a vision of creating the future into our management system and globally accelerate the innovation of technologies, which serve as the driver of our competitiveness, considering how technologies will advance in the future.
Technology is becoming increasingly complicated and interconnected. We intend to not only combine the advantageous technologies that we have developed, but also to adopt external technologies in fields related to our businesses and combine them with our own technologies to facilitate and encourage innovation with a sense of urgency. We are examining ways to establish the Lifestyle Fund in the future, which will be the framework for this ambition.
We have already implemented new initiatives at our product development sites. The Living Appliances and Solutions Company, for instance, has introduced the Micro Enterprise system to eliminate barriers between development, production and sales, aiming to halve product development lead-time compared to before. The company has built a team that enables members of each process that develops a product to continue to connect with customers throughout the lifecycle of the product, while also taking responsibility for product planning, market launch and the income and expenditure the product generates in its lifetime. Currently, nine micro enterprises have been launched in the category of white goods, such as refrigerators, dishwashers, microwave ovens, rice cookers, IH cookers, oral care products, hair care products, vacuum cleaners and washer-dryers.
In addition, we aim to further enhance the creation of future standards, shaping a world view and building customer relationships to maximize our brand value by enhancing customer loyalty in terms of touch points through products and services.
In order to pursue further operational excellence, the second transformational axis, we will enhance our competitiveness across barriers between spin-offs. With the stable procurement of various components, including semiconductors, becoming increasingly important, we are conducting a zero-base review of our supply chain to convert individually optimized infrastructure to being wholly and fully optimized. We are targeting cost reductions of 100 billion yen over the next three years by promoting both the enhancement of cost competitiveness and stable procurement without exception in a top-down manner.
With the entire Group promoting Panasonic Transformation and Panasonic-style digitalization, we will also increase our investment in IT by four- to five-times compared to before.
The third transformational axis consists of concentrating management resources on growth businesses. First, spin-offs will concentrate their management resources on growth businesses in which they can demonstrate their competitiveness and advantages. From a broader perspective, we will implement strategic capital allocation for the portion exceeding the volume of resources available.
Thereafter, each business will create several core businesses that will be worth 100 billion yen in profit in the future with the aim of establishing the leading or second leading position in their respective industries. We will establish a foothold to exert our competitiveness by disclosing management data for each spin-off so that the progress and status of the businesses can be understood both inside and outside the company.
Drive Transformation on a Company-Wide and Cross-Sectional Basis toward Sustainable Business
The division accounted for 90% of the total GHG emissions of the Panasonic Group in fiscal 2020, since the majority of our total emissions comes from Scope 3. This means our commitment will play a critical role in achieving net-zero emissions across the entire Group by 2050. While working to reduce CO2 emissions through the three transformational axes and reform of our management system, we will embark on expanding and creating businesses that help to reduce CO2 emissions, including the hydrogen fuel cell business.
Business operations will commence as a new company from April, and we will implement the previously mentioned innovations through the cross-sectional function of CXO, the strategy division consisting of a few highly capable employees. Currently, the presidents of the five spin-off companies, who will play a major role in our business, will be taking on new businesses while leveraging their experience and strengths. We will provide solutions for the wellbeing of people, society and the planet, with each spin-off entering their industries and its customers face-on while being conscious that our customers are the best partner for supporting their daily lives.